Global| Jul 13 2020U.S. Government Budget Deficit Surges to Record $864.1 Billion in June
by:Tom Moeller
|in:Economy in Brief
Summary
• Monthly budget deficit pulls fiscal YTD deficit to $2.744 trillion. • Receipts weaken sharply while outlays surge. The U.S. Treasury Department reported that the federal government ran an $864.1 billion budget deficit last month, [...]
• Monthly budget deficit pulls fiscal YTD deficit to $2.744 trillion.
• Receipts weaken sharply while outlays surge.
The U.S. Treasury Department reported that the federal government ran an $864.1 billion budget deficit last month, compared to an $8.5 billion deficit twelve months earlier. The Action Economics Survey anticipated an $800 billion deficit. Since the start of the fiscal year, which began in October, the cumulative deficit increased to $2.74 trillion versus $747.11 billion one year ago.
So far this fiscal year, the deficit has surpassed the full fiscal year record of $1.41 trillion set in 2009. The fiscal year-to-date deficit is roughly 13% of GDP.
On a FY basis, federal government outlays jumped 49.1% this year. The increase in outlays was driven by a 131% jump in income security payments this fiscal year which reflected the higher unemployment rate and payments for the government's Paycheck Protection Plan. Defense outlays grew a lessened 6.0% y/y and health care outlays rose an accelerated 27.4% y/y in FY20. Medicare payment growth jumped to 22.3% y/y.
On the revenue front, the recession and the extension of the April 15 tax-filing deadline to July 15 lowered individual income tax receipts by 24.3% y/y. Corporate tax receipts fell even more sharply. Growth in social insurance tax payments slowed to 4.9% y/y and the reduction in global economic trade pulled the y/y advance in customs duties down to 2.2% so far in FY 2020.
Haver's data on Federal Government outlays and receipts as well as CBO forecasts are contained in USECON; detailed data can be found in the GOVFIN database. The Action Economics Forecast Survey numbers are in the AS1REPNA database.
Policymakers' Response to COVID-19 Can Draw on Great Recession Lessons from the Federal Reserve Bank of Dallas is available here.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
More Economy in Brief
